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July 31, 1957 

Hon. Robert S. Calvert Opinion No. WW-212 

Comptroller of Public Accounts 

Capitol Station Re: Whether or not a partiAustin, Texas cuiar manner of issuing 

cigarette permits for 

cigarette vending machines 

would be permissible under 

the provisions of the 

Dear Mr. Calvert: Cigarette Tax Law 

Your opinion request dated July 17, 1957, is as 

follows: 

"Quoted below is an outline of the 

procedure t.hat certain cigarette vending 

machine operators would like to follow in 

regard to their cigarette permits: 

" 'Duri,ng the past several years we 

have noted an increasing number of cigarette 

machines staying in our shot not selling 

e~l.garettes and have givei. some thought 

about decreasing the cost of the permits 

for these machines. 

ML We desire to use a plan whereby the 

cigarette dealers permit will be identified 

by a machine cabinet lumber which we will 

place on a metal tag znd attach to each 

machine on location sel~ling cigarettes. We 

feel that the :nspection of a machine can be 

made more readily Ln that the corresponding 

machine number will be placed on the outside 

of a machine cabinet in plain view rather 

than using t~he unit number which often is 

not in view until the cabinet door has been 

opened. We feel that by using this plan 

we will not have to handle the permits 

nearly as much as before, thereby reducing 

the chances of losing or misplacing. 
Hon. Robert S. Calvert Page 2 (WW-212) 

"'We plan to replace the old permits 

coming due each month with permits carrying 

our new machine cabinet numbers. For until 

the machine is placed on location at which 

time we will request a permit with a new 

machine cabinet number. 

"'Rather than requesting duplicate 

permits for all of our cigarette machines 

with the new cabinet numbers at one time, 

we plan to renew the old permits coming 

due each month with permits carrying the 

new cabinet numbers for only machines on 

location selling cigarettes. Thus after 

one year we will have all machines on 

location numbered with a cabinet number 

and a corresponding cigarette dealers permlt attached. Our machines not on location 

and not selling cigarettes will not have a 

cabinet number or a cigarette dealers permit 

until such time as they be placed on location 

to sell cigarettes. When we take a machine 

to a location to sell cigarettes we will 

place a cabinet number and a corresponding 

permit on the machine. By not having to 

purchase permits for the machines not on 

location, we expect to save a considerable 

sum of money.'" 

If we understand y~our request correctly, you want 

us to advise you upon the question which we state as follows: 

May a Retail Dealer of cigarettes selling and distributing by vending machines 

transfer a Retail Dealers Permit which has 

been issued for the operation for a particular vending machine to another machine without 

taking out a new permit. 

We are concerned here only with Retail Dealers, Retail Dealers Permits and vending machines. 

Sue-Sec. d of Section 1 of Art. 7047~ -1 Vernon's 

Civil Statute defines a place of business as follows: 

"'Place of Business' Is construed to 

mean and include any place where cigarettes 

are sold or where cigarettes are stored or 
-_ - 

Hon. Robert S. Calvert Page 3 (W-212) 

kept for the,purpose of sale or consumption; or If sold from any vehicle, 

train, or cigarette vending machine, 

the vehicle, train or cigarette vendin 

machine on which or from which suc -T-+ 

cigarettes are sold shall constitute a 

place of business." (Rnphasis added) 

Sub-sec. o of Section 1 of Art. 7047c-1 V.C.S., 

defines a Retail Dealer as follows: 

"'Retail Dealer' shall mean and include every person other than a distributor 

or wholesale deal~er who shall sell, distribute, or offer for sale or distribution 

or possess for the purpose of sale or distribution, cigarettes irrespective of 

quantity or amount or the number of sales 

or distributions; and it shall also mean 

and include every person other than a distributor or wholesale dealer who distributes 

or disposes of cigarettes in unbroken individual packages or in quantities of ten (10) 

or more as gifts or prizes or in any other 

manner of distribution or disposal where no 

sale is involved." 

It is, therefore, quite apparent that a cigarette 

vending machine is within the statutory definition a "place 

of business" and that each separate machine is a separate 

place of business. 

Sec. 4 of Article 7047@-1, 

as follows: 

v.c.s,, provides in part . 

"Every retail dealer in this State 

now engaged or who desfres to bec'ome engaged, in the sale or use of cigarettes 

upon which a tax is required to be paid, 

shall, within thirty (30) days from the 

date this law becomes effective, file with 

the Comptroller an application for a 

cigarette permit as a retail dealer, said 

application to be accompanied by a fee of 

Five ($5.00) Dollars. 

Each vending machine must have a serial number as 

provided in Section 4 as follows: 
Hon. Robert S. ,Calvert Page 4 (WW-212) 

"If the application Is for a permit 

to sell cigarettes from or by means of a 

cigarette vending machine, train, automobile or other vehicle, the serial number 

of said vending machine, the make, motor 

number and State highway license number 

of said automobile or other vehicle and 

the name of the railway company and number 

of said train shall be shown on the applications." (Emphasis added) 

The manufacturer's serial number on vending machines 

is the only means of identification of the particular vending machine and we think by referring to the serial number 

in the statute evidences a legislative intent that no 

transfer of a permit is permissible from one vending 

machine to another bearing a different serial number. 

Clearly, the manufacturers serial number may not be changed, 

and by the same reasoning the permit granted for the opertion of a particular vending machine may not be transferred 

to'another bearing a different serial number. 

No where in the statute is there definite authorization for the transfer or assignment of permits once issued by the Comptroller; nor is there justification for 

concluding that it is reasonably inferred. On the other 

hand there is a definite prohibition against assignments, 

for the statute specifically says in Section 4,,that upon 

the receipt of the application for the permit . . . the 

comptroller shall issue to every distributor, wholesale 

dealer or retail dealer for the place of business designated, a non-assignable consecutively numbered permit, 

designating the kind of permit and authorizing the sale 

of cigarettes in this State." Each permit is issued for 

a period of 12 months and must be renewed every 12 months. 

Suppose a Retail Dealer .operated 4 drug stores 

each with a Retail Dealer's Permit to sell and distribute 

cigarettes. Each one would be a separate place of business 

and would require separate permits. The statute would not 

authorize the transfer of the permit of one store to 

another. The same would apply to four vending machine's, 

if owned and operated by the same Retail Dealer, for each 

vending machine is as distinctively a separate place of 

business as each store would be. 

You are, therefore, advised that the answer to the 

question which we have stated Is in the negative. OnOe a 

permit is issued for a particular vending machine which 
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Hon. Robert S. Calvert Page 5 (NW-212) 

is serially numbered it may not be changed by transfer 

or assignment to another machine even though all of the 

machines are owned and operated by the same Retail Dealer. 

SUMMARY 

The permit Issued by the Comptroller for 

the sale and distribution of cigarettes by 

a Retail Dealer making sale and distribution 

by vending machines may not be transferred 

from one vending machine to another. Each 

vending machine must bear the manufacturer's 

serial number and is under the statute a 

separate place of business and a permit 

granted for the operation of a particular 

vending machine bearing a definite serial 

number may not be transferred to another 

machine with a different serial number. 

Yours very truly 

WILL WILSON 

Attorney General 

LPL;fb 

APPROVED: 

OPINION COMMITTEE: 

H. Grady Chandler, Chairman 

W. V. Geppert 

Wallace Finfrock 

B. H. Timmins, Jr. 

REVIEWED FOR THE ATTORNEY GENERAL 

BY: George P. Blackburn